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04/04/2013 03:47 PM

Japan's Solar Frenzy Continues, Could Place Second This Year

SustainableBusiness.com News

Japan will likely be the world's second largest solar market this year, after China, because of its feed-in program.

Installations on the order of 6.1-9.4 gigawatts (GW) are expected this year, mostly from commercial and utility-scale projects. That's more than double the previous forecast of 3.2-4 GW by Bloomberg New Energy Finance.

China is expected to add 6.2-10.5 GW this year. The US anticipates 3.3-3.9 GW, probably the third largest market. So far, the most solar added in one year was in Italy in 2011 - 7.9 GW.

"The upward revision is because of the rapid increase in shipments seen last quarter as well as the fact that the pipeline of projects is even stronger than previously expected," says New Energy Finance.

"This large introduction of solar is significant enough to compliment other strategies to alleviate power demand
issues from idling almost all nuclear plants in Japan," says Travis Woodward of New Energy Finance.

About the only thing holding solar back in Japan is a lack of trained installation workers, says New Energy Finance.

One of the large recent projects is on convenience stores owned by Lawson Inc. Solar rooftop systems are on 1000 stores, with plans to double that, reports Bloomberg. They are using Japanese-made solar panels by Panasonic and Solar Frontier.

Lawson will sell excess electricity to utilities and invest the proceeds in energy efficiency upgrades.

The largest solar project to date received the go-ahead, a 400 megawatt plant on an island, to be developed by German firm Photovolt Development Partners. The $1.1 billion dollar project will be connected to land via an undersea cable.

Last week, Japan's government approved a 10% cut in the solar feed-in price, which went into effect April 1. This new rate, which was expected, is $0.40 per kilowatt hour, and will remain in
force for a year.

Solar costs have been dropping along with the boom in installations, down 14% for non-residential systems since the feed-in law began, according to Japan's Ministry of Economy, Trade and Industry.

In February, the government announced it will invest $33 billion into grid modernization and development over the next 10 years, particularly to spur the growth of wind energy.